(^44) THE WEALTH AND POVERTY OF NATIONS
mary products, including raw wool, was well on its way to becoming
the premier manufacturing nation of Europe.
The economic expansion of medieval Europe was thus promoted by
a succession of organizational innovations and adaptations, most of
them initiated from below and diffused by example. The rulers, even
local seigneurs, scrambled to keep pace, to show themselves hospitable,
to make labor available, to attract enterprise and the revenues it gen
erated. At the same time, the business community invented new forms
of association, contract, and exchange designed to secure investment
and facilitate payment. In these centuries a whole new array of com
mercial instruments came into use; commercial codes were elaborated
and enforced; and partnership arrangements were devised to encour
age alliances between lenders and doers, between the men who sup
plied the funds and merchandise and those who went to distant lands
to sell and to buy. Almost all of this "commercial revolution" came
from the mercantile community, bypassing where necessary the rules
of this or that city or state, inventing and improvising new venues for
encounter and exchange (ports and outports, faubourgs, local markets,
international fairs), creating in short a world of its own like an overlay
on the convoluted, inconvenient mosaic of political units.
They got thereby substantially enhanced security, a sharp reduction
in the cost of doing business (what the economist calls "transaction
costs"), a widening of the market that promoted specialization and di
vision of labor. It was the world of Adam Smith, already taking shape
five hundred years before his time.
nora
(Nora)
#1